00:00There are two takeaways that I'd like to share today.
00:02One is that electrification and the direct use of renewable is a critical part of energy transition for the power market.
00:10Second is that looking into our long-term outlook from now to 2050,
00:15because of the cost decline and policy support that we see all over the world,
00:20that the capacity additions of renewable, so that's wind and solar plus battery,
00:27is going to account for 96% of the net capacity additions,
00:32so that's a very significant amount of investment that we're expecting from renewable resources.
00:39We are here at the S&P Global Mumbai Forum,
00:42and what I was essentially talking about was what's happening with global trade.
00:46If you look at what our view is, the geopolitical landscape has changed,
00:50and that's become essential to what's happening with global trade now.
00:53And the traditional supply chain economist, as well as traditional supply chain analysis,
00:58has mostly focused on input, your labor costs, your energies, and so on,
01:02but now geopolitics has become a critical part of it.
01:05So whenever somebody's planning in terms of the long-term gestation of how the global trade would evolve,
01:10you will have to take into account what's happening with the geopolitical landscape,
01:14what's happening with the global tariffs, and so on.
01:16So that was the key thing which we talked about.
01:19We get a lot of questions from our clients talking about what's happening with globalization.
01:23Our view is globalization has certainly peaked, particularly for the east-west trades, right?
01:28And the second thing is there will have to be newer markets which will have to emerge to drive the global trade growth
01:33to the same level which we've seen over the last several years, or at least for the last two decades.
01:37Unlikely in that view, because the east-west trade, which is primarily north Asia to the European markets,
01:44to the American markets, that is certainly peaked.
01:47And the global trade growth multiples compared to the global GDP continue to compress.
01:52So that's the key thing which we were highlighting to our clients here this morning.
01:56When we think about this world today, it's a world of uncertainty.
01:59It's a world where governments and policymakers, but as well companies, have to make decisions about long-term investments.
02:08Dealing with uncertainty is becoming central.
02:12So at S&P Global, we have taken an approach, or we have an approach based on scenarios.
02:19And what we are seeing here is that in the three scenarios that we have, plus our base case,
02:28one of the things that we see more dominant, and I was sharing with people today,
02:33was that fossil fuels will continue to be very important in that story.
02:38It's going to be the coexistence of fossil fuels continuing to play a key role,
02:43combined with a clear advance, as well, of clean technologies in the mix.
02:49Because when we look at the energy transition and we analyze if the energy transition has accelerated,
02:56is it slowing down, has it happened, is it not happening,
03:00what our data says is that basically it is happening.
03:04It is happening at a slower pace than what we would like, but it's still happening.
03:11And then one thing, when we focus more specifically on India,
03:15what is important to highlight is two things.
03:19In India, the story is going to be about renewables.
03:23Renewables are going to be capturing most of the growth,
03:27are going to deliver most of the new electricity that is going to be required.
03:32However, coal is going to continue to be very resilient.
03:36Coal is here, is part of the mix,
03:38and will continue to play a key role in order to provide the flexibility that the system needs.
03:45That said, in all the scenarios,
03:48excepting the most aggressive ones on energy transition,
03:51will result in India seeing an increase of its emissions.
03:56That, in the case of one of the scenarios, is going to be quite significant.
04:01So, more to do, homework to do, more renewables to be built,
04:06and an acceleration of the energy transition that will come with some challenges,
04:11but as well with a lot of opportunities.
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